The Precious Metals Bull Market Is Just Getting Started
The recent nasty selloff in silver caused many to conclude that the bull market in precious metals has topped out. An analysis of the fundamentals shows that this couldn’t be further from the truth. In reality, the precious metals bull market is just getting started. Tavi Costa put it this way in a superb essay on Twitter Thursday: “What we have seen to date is the awareness phase of a bull market.”
What’s the evidence for this claim?
Take a look at the chart at the top of this blog. In previous gold bull markets, the market cap of gold has approached the market cap of global equities. To date this time around, as you can see, the gold market cap is just starting to go up as a percentage of global equities market cap.
The dollar is the foundation of the current global monetary order. But as you can see in the chart above from Tavi, US gold reserves only amount to 3% of US government debt. In other words, we are awash in a sea of paper dollars without backing. Central banks around the world are increasing the percentage of their reserves held in gold and decreasing the percentage held in dollars. This rebalancing is in the early stages and means that the gold price will continue to appreciate versus the dollar.
While $75,000/oz or even $26,000/oz seem outlandish, I do think gold is on its way to $10,000/oz over the next couple years. My concern is that the dollar will implode if it goes much higher than that. If so, we are looking at financial armageddon. If you want to see a prescient fictional account of what that might look like, check out Lionel Shriver’s The Mandibles: A Family, 2029-2047 (2016).
Newmont (NEM), the largest gold miner in the world, reported 4Q25 earnings Thursday afternoon. While shares are currently down 3% in the premarket, you should focus on the big picture. As the gold price rises, if gold miners can hold their production costs relatively steady, all of the increase in price flows to their bottom line.
As NEM’s Average Realized Gold Price has increased to $3498/ox in 2025 from $2408/oz in 2024 and $1954/oz in 2023, their Gold All In Sustaining Cost has remained relatively flat at $1609/oz in 2025 from $1516/oz in 2024 and $1444/oz in 2023. The result has been a tripling in Adjusted EBITDA over the last two years to $13,480 million in 2025 from $4,215 in 2023. Adjusted EBITDA Margin has increased to 59.5% in 2025 from 46.4% in 2024 and 35.7% in 2023.
Like I said two paragraphs ago, if the gold miners can execute they will essentially be printing money with gold prices at current levels – and higher. While the stock chart looks parabolic and there will be nasty shakeouts, NEM and the rest of the gold miners are going much, much higher over the next few years.
While FinTwit and the financial media in general continues to focus on The Magnificent 7 and Artificial Intelligence, the regime has changed. The real bull market over the next decade will be in the precious metals and commodities space. Those who understand the shift that is taking place and can stay the course will make extraordinary profits. Those who remain stuck in the previous paradigm will miss out.
